India has been preferred to China for immediate expansion plans by the US-based bio-pharma companies as they want to establish alliances for research. The US companies prefer to tie up with Chinese counterparts only after two years period when the US companies have reached the stage of commercialisation of products, ORS Rao, director, Cygnus Business Consulting and Research, told Pharmabiz.

The US-based ATS Venture Advisors and Hyderabad-based Cygnus Business Consulting and Research have developed a report titled 'Cross border alliances in the biopharmaceutical industry: The US and the Indian companies', based on a joint survey. ATS Venture is a US biotech business advisory services company providing a range of services like new venture formation, technology sourcing and evaluation, M&A, capital raising, joint ventures and licensing. Cygnus is a knowledge services organisation covering the entire value chain of business information- Business Intelligence products, Research and Consulting.

Of the 70 US companies that took part in the survey, about 66 per cent respondents were key decision makers. Eighty per cent of companies want to expand into international markets. They were seeking partnerships for product sourcing/supply (APIs) and R&D services outsourcing, he added.

About 65 per cent of the respondents who took part in the survey among 70 Indian companies, were key decision makers. The respondents viewed US/North America to be the most important regions, followed by EU for expansion plans. The joint venture route has been preferred for importing manufacturing technology, whereas licensing agreements are preferred for importing R&D technology. Indian companies are keen to establish strategic partnerships with US companies.

The report pointed that there is a need to check migration of students for higher studies by creating centres of excellence in select areas, attract talented students to go in for post graduation and Ph.D, introduce more technology oriented management courses, as the industry moves into commercialisation of products and services, introduce diploma courses on regulatory and IPR laws. Candidates with inter-disciplinary knowledge are required today with expertise in areas such as sales, legal, finance and business development, Rao added.

Global bio-pharma industry stood at $64.3 bn in 2005. Major issues of the industry has been increasing cost of drug discovery, low R&D productivity and slower returns on investment. Alliances in the sector have been established mainly for drug discovery outsourcing, outsourced manufacturing and market expansion.